Foxconn is moving beyond iPhones, and the next business is growing even faster

Chairman Young Liu flags strong AI demand and US expansion as key drivers; cloud and networking unit becomes top revenue contributor

• Foxconn's AI server shipments may double in 2026.
• AI sales now exceed consumer electronics at Foxconn.
• Foxconn's US plant to make 2,000 AI server racks weekly by 2026.

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Taiwan’s Foxconn, the world’s largest contract electronics maker, expects its AI server rack shipments to grow at a “high double-digit” pace in the first quarter and potentially double for the full year 2026, signalling a sharp acceleration in its AI push.

Chairman Young Liu, according to a report by Focus Taiwan, said the company’s broader AI portfolio is also likely to gain market share this year from an already strong base. Foxconn currently holds around 40 percent of the global AI server market.

AI business overtakes consumer electronics for the first time

A key shift in Foxconn’s business mix is already visible in its revenue breakdown.

In 2025, the cloud and networking division, which includes AI servers, accounted for 40 percent of total sales, overtaking the smart consumer electronics segment at 38 percent for the first time.

The computing division contributed 15 percent, while electronic components and other businesses made up the remaining 7 percent.

The crossover marks a structural change for Foxconn, long known for assembling consumer devices, as AI infrastructure becomes its primary growth engine.

US manufacturing hub to anchor next phase of growth

Foxconn’s expansion in AI is being anchored by its production capacity, particularly in the United States.

The company’s largest AI server manufacturing facility in the US is expected to produce about 2,000 server racks per week in 2026, positioning it to meet rising demand from cloud service providers.

The localisation of production also aligns with broader shifts in global supply chains amid geopolitical tensions and trade uncertainties.

Strong earnings provide momentum for AI expansion

Foxconn’s push into AI comes on the back of record financial performance.

The company reported a net profit of New Taiwan dollars 189.35 billion (about USD 5.92 billion) in 2025, up 24 percent from a year earlier.

Consolidated revenue rose 18 percent to USD 253.54 billion, supported by growth in both its cloud and networking and smart consumer electronics segments.

AI demand remains resilient despite global risks

Liu said demand for AI servers has remained strong despite global economic headwinds, including tariffs, geopolitical tensions and currency volatility.

The resilience is being driven by continued capital expenditure by major cloud service providers, which are investing heavily in AI infrastructure.

Foxconn expects both its cloud and networking and smart consumer electronics divisions to post strong year-on-year sales growth in the first quarter, although the computing division may see a decline.

Dividend payout hits record high

Separately, Foxconn’s board approved a cash dividend of USD 0.23 per share for 2025, the highest since its listing in 1991.

With earnings per share of USD 0.43, the payout ratio stands at 52.9 percent.